THE ROLE OF THE PRIVATE SECURITIES TRADING  LAWYER

• Robert Townsend represents clients world-wide in multi-million dollar private securities trading programs. "Private Securities Trading Programs may be known by other names:  High Yield Investment Programs, HYIP, Bank Trading Programs, Debenture Trading Programs, Bank Debenture Trading Programs and often involves the trading of Medium Term Bank Notes (MTN's).

 
• Townsend also represents clients in "higher yielding investments" which have no relationship to the so-called "high yield investment programs (HYIP) discussed above.

 
• He represents mostly investors.  He has represented "traders", intermediaries and others, primarily in reference to governmental actions  and civil litigaiton.

 
• He has over 20 years of experience in private securities trading matters with a worldwide reputation for knowledge and excellence.

 
• He also writes articles, including on the internet, to help potential investors and brokers become educated in this field full of fraud.   See "HYIP's In A 7 Minute Nutshell" at http://townsend-law.netfirms.com/hyip.htm
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• The nature of his representation includes (1) protection of investment, (2) recoupment of investments, (3) due diligence prior to investment, (4) document review, and (4) SEC and governmental authority problems, etc.

 
• Townsend DOES NOT OFFER INVESTMENT PROGRAMS.   HE ONLY WORKS WITH REFERENCE TO SITUATIONS BROUGHT TO HIM BY CLIENTS FOR WHICH THEY SEEK LEGAL ADVICE.

 
• Townsend does NOT refer existing clients to investments or investment programs.

 
• Townsend has appeared in court as an  international expert witness on private securities trading issues.  However, he has never testified to support the issues of the "existence" of so-called high yield investment programs or to the participation in them by any governmental entity or the United States Federal Reserve System.




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Seven Key Points About  High Yield Investment  Programs (HYIP's):

1. In the United States it is a cvil and criminal fraud to represent that some of these trading programs even exist.  It is clearly a fraudulent misrepresntation to state that the extraordinary yields are attainable "without risk".  This poses an immediate problem for offerors and intermediaries of these type programs. 

2.  One may be subject to perjury charges to say under oath that they exist.

3. There are both lawful and unlawful trading type strategies, and it is of vital importance that one is able to make the legal distinction between them to avoid SEC and criminal complications.

4.  Various governmental agencies (U.S. and International) often finds "prime bank fraud" under every bed whether it is present or not...and they may prosecute even where it does not exist.  This should should be taken as a very serious warning to offerors, intermediaries, their accountants and lawyers...and sometimes even investors. 

5.   IT IS IMPORTANT TO NOTE THAT the SEC and other governmental agencies around the world CLEARLY AND ACCURATELY warn that there is a plethora of prime bank frauds, and everyone should be aware of it and act accordingly.   However, it is also important to note that in its well intentioned efforts to protect people from these type frauds, the warnings may be over broad and possibly lead investors away from legitimate investments that are totally unrelated to "high yield investment programs" and frauds that are spawned from such investments (e.g. leasing money programs).  In any event, The presumption should be that fraud is present! Repeat: The presumption should be that fraud is present!

6.   For the record Mr. Townsend  has NEVER observed a lawfully paying trading program with the extraordinary and unrealistic yields of  the nature promised by most offerors of so-called "high yield investment programs".

7.   However, Mr. Townsend is very much aware of situations where on occasion the returns on investment have substantially exceeded general  market expectations (i.e. "higher yielding investments"), though clearly not the extreme yields generally promised in so called "high yield investment programs" offered "without risk". 

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VERY SERIOUS AND IMPORTANT WARNINGS AND ADMONITIONS

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"CARDINAL RULE" WARNING TO INVESTORS.If your are an INVESTOR, do NOT  transfer or agree to transfer any money or asset to anyone without first obtaining advise from a lawyer competent in this area of finance and the law.   ("First" is underlined, because the lawyers generally see these cases when it is too late, and then the job is to recover lost funds which is very expensive.)

 

"USE YOUR HEAD" WARNING TO INVESTORS.  The legal fees are comparatively minuscule when spent before the investment is made. (It is tragically amusing that investors with good business sense who over the years have customarily used a bevy of lawyers in accumulating their wealth will not spend a few dollars on competent legal advice prior to PERMANENTLY parting with that wealth in investing in a certain high yield investments programs. This tragedy happens every damn day with out fail!)

 

BROKERS BEWARE!!   Whatever the case may be, if you are an intermediary, broker, facilitator, or self-styled "commitment holder" or "trader", with regard to high yield investment programs DO NOT take any money whatsoever from investors or other brokers OR make any representations whatsoever to potential investors OR other brokers without first seeking the advise of a lawyer experienced in this area of finance and the law.  Just speaking to others about these subjects may be a criminal conspiracy.  Brokering these type investments invariably involves breaking the law.  The chances are that you will violate the law in one or more of the following ways: (1) Make a false representation in an offer or sale of securities [e.g. hyip's exist], (2) offer or sell unlawfully unregistered securities, or (3) offer or sell a security without being licensed to do so.  In the process you will probably violate the securities laws of the United States, the "blue sky" laws of various states, and possibly the fraud and securities laws of foreign countries.  It is important to note (1) that any involvement no matter how remote or innocuous will bring you within the web of the prosecutors, and (2) these activities are all felonies carrying substantial prison terms (often including first time offenders). 

THE TECHNIQUE TO THE RECOVERY OF DEFRAUDED FUNDS

        How It's Done.  The recovery of defrauded funds can in many cases be highly successful.  Most of these cases involve funds moving between various jurisdictions.  Through the legal process of "discovery", the money trail has to be followed, and thus one is able to trace and find the fraudsters or the lost funds or both and recover the defrauded funds.  Townsend's approach is as follows:  Townsend hires associated lawyers in every jurisdiction where money has been traced and uses the courts of each jurisdiction to return that money to the clients.  Townsend creates the total strategy, instructs the associated lawyers, and supervises the matter from beginning to end.  Each interview or deposition opens the door to another source of recovery. 

        The Cost.  It is important to note, that this is an expensive proposition and the expenditure of funds for this pursuit should only be taken where the amount of lost funds is highly substantial.  These case are not handled on a contingency basis; i.e. the legal fees are paid from the recovery; this cannot be done because attorneys, investigators and travel expense must be paid as the expense occurs.  Example of fees and costs:  If a client has lost over $5 million, then the fees and costs may be around $300,000.  This of course, depends on how many jurisdictions the funds have flowed into and the amount of the funds.  Thus, it may be more or less.  But this should be helpful.

KEY WORDS TO WORRY ABOUT IN IDENTIFYING HIGH YIELD INVESTMENT PROGRAM ISSUES (If you see these words, be concerned and learn what they mean!)

High Yield Investment Programs     High Yield Investment Bank Trading Programs
International Bank Guarantees    Medium Term Bank Note     MTN     MTN's  HYIP
Medium Term Bank Notes    Trader  Facilitator  Commitment Holder  Intermediary
Bank Debentures   Bank Debenture Trading Program   Letter of Credit   L/C
Bank Secrecy  Non-Disclosure and Non Circumvention Agreements  NCND  NDNC
Blocked Funds   Reserved Funds     Unconditional SWIFT     Pay Orders  No Risk
Federal Reserve   Fed  IMF    International Monetary Fund    United Nations    U.N.
ICC  International Chamber of Commerce  ISP98  SBLC  Standby Letters of Credit
Safe Keeping Receipts    SKR   KYC  SAR  Suspicious Activity Report    LOI
International Bank Guarantee   International Standby Practices 1998  Joint Venture
Joint Venture Agreement   JV Agreement  Power of Attorney   POA  Letter of Intent
Proof of Funds   POF  Copies of Passport   Bank Guarantee Trading Program
Bank Guarantee  Bank Endorsed  Confirmed   Authenticated  SWFIT
 

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